Longda Meat, known for its meat slaughtering business, is planning to expand its production capacity downstream into the processed food sector. In December, it announced plan to invest in the construction of meat processing and condiment production in Yangpu Economic Development Zone, near Hainan Province.
With a total investment of Rmb 426 million (US$67 million), it will have an annual production capacity of 45,000 tonnes of processed meat products and 15,000 tonnes of seasoning products. The main products include frozen prepared foods, pre-prepared semi-finished dishes, pre-prepared dishes and condiments.
To expedite the project implementation, Longda Meat will jointly invest Rmb 100 million (US$15.7 million) with Juxin Bohui Company to establish a joint venture company in Yangpu Port, Hainan.
The new strategy of Longda Meat is not to abandon its mainstream breeding and slaughter business, but to take breeding and slaughter as an important support for the food business, thereby ensuring optimal cost control of raw materials.
In its latest development, Longda Meat has also announced plan to change its name to ‘Longda Gourmet’ as part of its new strategy implementation this year – “Food as the main body, with breeding and slaughter as the support”.
Nevertheless, Longda’s processed food business has not yet grown into its main revenue source. In the first half of 2021, Longda Meat’s food business still only accounted for 7.29% of its total revenue.